FILED: KINGS COUNTY CLERK 05/06/ :00 PM INDEX NO /2013 NYSCEF DOC. NO. 44 RECEIVED NYSCEF: 05/06/2015

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1 FILED: KINGS COUNTY CLERK 05/06/ :00 PM INDEX NO /2013 NYSCEF DOC. NO. 44 RECEIVED NYSCEF: 05/06/2015 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF KINGS X Index No.: 8409/2013 JAMES JENKIN, -against- Plaintiffs VERONICA CADORE, MICHELLE CADORE AND JOHN DOE #1-4 AND JANE DOE #1-4 (Said names being fictions, it being the intention of Plaintiff to designate any and all occupants of the premise located at 119 MacDonough Street, Brooklyn, NY and any parties, corporations or entities, if any having or claiming an interest or lien upon said premises), VERIFIED THIRD-PARTY COMPLAINT AND CROSS CLAIM Defendants VERONICA CADORE, MICHELLE CADORE, -against- Defendant/ Third-Party Plaintiff, PETER J. GOODMAN AND THE GOODMAN LAW FRIM Third-Party Defendants X Defendants and Third-Party Plaintiffs, VERONICA and MICHELLE CADORE, as and for their Third-Party Complaint alleges as follows: 1. The Defendants and Third-Party Plaintiffs, VERONICA and MICHELLE CADORE (the CADORE s ) are the homeowners of the property, 119 MacDonough Street, Brooklyn, NY (the subject property ). 2. The CADORE s are unsophisticated in real estate and legal matters.

2 3. The Third-Party Defendants, PETER J. GOODMAN AND THE GOODMAN LAW FRIM ( GOODMAN ) represented Defendants and Third-Party Plaintiffs, the CADORE s, in the underlying real estate transaction for the Residential Contract of Sale for the subject property in which the CADORE s are now being sued for specific performance and other relief. 4. Based upon information and belief, GOODMAN holds himself out as sophisticated in real estate matters and as an attorney proficient in real estate matters. 5. On or about 2007, the CADORE s defaulted on their mortgage. 6. Thereafter HSBC, allegedly the holder of the mortgage and note, brought three civil actions to enforce the note. See Index No. s: /2009; /2007 and / On June 5, 2014, Index No /2009, HSBC v. CADORE was dismissed. 8. On July 17, 2014, Index No /2007, HSBC v. CADORE was dismissed. 9. On February 5, 2015, Index No /2007 HSBC v. CADORE was dismissed. 10. In all these foreclosure actions, Joseph McCray, ( MCCRAY ) filed numerous motions, claiming to be either the owner or part owner of the property, when in fact he was and is not. 11. MCCRAY is a criminal who has been convicted and incarcerated for real estate fraud. 12. GOODMAN failed to monitor the underlying foreclosure actions, in that he failed to advise the CADORE s that these actions could be dismissed, which they were, and therefore should not be a lien on the property.

3 13. On December 14, 2012, Plaintiff, JENKIN, contracted with the CADORE s to purchase the subject property for eight hundred fifty thousand dollars ($850,000) The subject property is a four family brownstone home located in the Bedford Stuyvesant section of Brooklyn. 15. Based upon information and belief, the value of the property is approximately two million dollars. 16. Based upon information and belief, on or about December 14, 2012, Plaintiff gave $42,500 payable to GOODMAN as a down payment. 2 (Exhibit A) 17. Based upon information and belief, Plaintiff, JENKIN, knew of the CADORE s foreclosures. 18. Based upon information and belief, Plaintiff, JENKIN, took advantage of the CADORE s foreclosure litigation mess and attempted to purchase the subject property at a bargain basement price. 19. Based upon information and belief, Plaintiff, JENKIN, is sophisticated in real estate matters and intended to use the subject property as an investment. 20. The real estate website Zillow lists the property as having a value between 1.66 million to 1.84 million. 21. Based upon information and belief, Plaintiff attempts to conceal an appraisal of the property, which would indicate a value of the subject property well over the $850,000 asking price. 22. Plaintiff never provided a copy of the appraisal to the Defendants. 1 However, the Second Rider, is dated on or about October Someone inserted the contract date of December 14, 2012, when the parties actually signed the contract on or about October 2012.

4 23. Based upon information and belief, and Plaintiff s complaint wherein he alleges investment damages of $2,000,000, Plaintiff attempts to take advantage of the CADORE s when he offered to purchase the property at less then half its actual value. 24. Plaintiff did not provide the customary 10% down payment that is typical in a downstate real estate transaction of this type. Plaintiff only offered 5% down. 25. Plaintiff never explains why he should be able to only put 5% down and to purchase the property at well below market value. 26. Based upon information and belief, GOODMAN failed to require the customary 10% down payment for purchase of the subject property. 27. Homeowner s like the CADORE s are typically targeted for foreclosure rescue scams. 28. Based upon information and belief, Plaintiff intentionally targeted the CADORE s in an attempt to steal the equity from their home by offering a price for the subject property far below market value. 29. Plaintiff s title report that they obtained for the subject property, states that McCray became an owner of the property in (Exhibit B) 30. The title report, dated 12/21/12, indicates on Schedule B, paragraph 28 and paragraphs 35 through 40, that title to the subject property is clouded by various foreclosures and legal actions pending in Supreme Court. 31. Moreover, the title report certifies good and marketable title to: Joseph McCray, Veronica Cadore and Michelle Cadore as their interest may appear. (See, Exhibit B) 2 Based upon an examination of the Residential Contract of Sale, Peter Goodman, Esq., is named as Escrowee in the Contract, however, it appears he never signed the contract.

5 32. JENKIN, commenced this action against the CADORE s seeking specific performance for the purchase of the subject property; including loss of investment value, which he claims are damages in the amount of $2,000,000 and consequential damages in the amount of $1,000,000; and other relief. (See, Plaintiff s Summons and Complaint.) 33. Paragraph 21(b) of the Contract for the sale of subject property deals with liens and attempts to resolve them so that title could be delivered to the Purchaser. 34. However, this provision is made moot by the Rider, paragraphs 1 and 10, which state: 1. If this rider conflict in any way with the printed contract of sale, the rider shall control. 10. At least thirty (30) days prior to closing, Purchaser agrees to deliver to the attorneys for the Seller, a list of any objections or violations which may appear on any proper examination of title. A delivery of the title report shall constitute delivery of such list. If any objections or violations appear on said title examination and cannot be cleared by the Seller by the time set for closing of title, the Seller, at his sole options, shall be entitled to a reasonable adjournment not more than 60 days of the closing for the purpose of removing said objections or violations. Nothing herein shall be deemed to require the Seller to take any actions or proceedings to cure any defects in title. Except that Seller must comply with the terms of 21(b)(iii). If for any reason, the Seller shall be unable to convey a good and marketable title, the sole obligation of the Seller shall be to refund the Purchaser deposit hereunder. Upon the return of such deposit and the payment of such reimbursement, the Purchaser shall have no further claims against the Seller nor any lien against the premises, and Purchasers shall at that time surrender title contract for cancellation. (emphasis added) 35. Paragraph 21(b)(iii) states:

6 (iii) notwithstanding the foregoing, the existing mortgage (unless this sale is subject to the same) and any matter created by Seller after the date hereof shall be released, discharged or otherwise cured by Seller at or prior to Closing. 36. Marketability of title is concerned with impairments on title to a property, i.e., the right to unencumbered ownership and possession, not with legal public regulation of the use of the property (see, Lincoln Trust Co. v Williams Bldg. Corp., 229 NY 313, 318, supra; 5A Warren's Weed, op. cit., Title, 1.01; compare, 3 Warren's Weed, op. cit., Marketability of Title, 1.01, 2.01, with 8.07). 37. Since the CADORE s were unable to deliver good and marketable title, in that MCCRAY appears in title, their sole obligation in accordance with the contract and rider to the contract was to refund the Purchaser s down payment. 38. Sellers informed their attorney, GOODMAN, on or about March 21, 2013 that they wanted to cancel the contract and return the down payment to JENKIN. They informed GOODMAN verbally and via . (Exhibit C) 39. GOODMAN failed to turn over the down payment, and based upon information and belief may have converted it. 40. GOODMAN failed to provide a contract to the parties that was intelligible in that the Contract fails to explain the rights and obligations of the Escrowee if the Contract does not close. 41. Paragraph 6 of the Contract states in part,....if for any reason Closing does not occur and either party gives Notice (as defined in paragraph 25) to Escrowee demanding payment of the Down payment. Escrowee shall give prompt Notice to the mortgage is a bank or other institution as defined in Section other party of such demand. (See, Exhibit A)

7 42. There is no paragraph 25 in the contract. 43. Based upon the provisions of the contract and the CADORE s directive to their attorney GOODMAN, the contract deposit should have been returned and thereby the contract would have been cancelled. 44. Even if the contract was not properly cancelled based upon GOODMAN s gross negligence, Plaintiff nonetheless failed to prove that he was ready, willing and able to close on the dates he claims were set for closing. 45. In order to obtain the remedy of specific performance, the Complaint must show: (1) the making of the contract and its terms, including a description of the subject matter; (2) that the plaintiff is ready, willing and able to perform the contract and has fulfilled all of the plaintiff s duties to date; (3) that it is within defendant s power to perform; and (4) that there is no adequate remedy at law. Lezell v. Forde, 891 N.Y.S.2d 606, 612, 26 Misc.3d 435 (Sup. Ct. Kings Cty., Oct. 15, 2009) 46. In accordance with the Contract for the subject property, the closing was to take place on or about December 19, Plaintiff claims that it was ready, willing and able to purchase the property, but fails to produce to this Court any documentary evidence which would show that he actually appeared at closing, that he had the funds ready and available at the time of closing and that the title company appeared at the closing or that the title company was ready to close. 48. In order to provide proof that Plaintiff was ready, willing and able to close, Plaintiff must provide a transcript where a stenographer states, under oath, who appeared at a scheduled closing at the designated time and place.

8 49. Plaintiff never produced such a transcript and thus never proves that he was ready, willing and able to purchase the property. 50. Plaintiff claims that he appeared at the closing by power of attorney, but fails to produce such a power of attorney to this Court. 51. Plaintiff never submits even a copy of a certified check showing that he had the funds available to purchase the subject property on the purported closing date. 52. There is no evidence that the title company was advised of the closing or that a title closer appeared at the time of the essence closing so as to insure that marketable title could be delivered as required. 53. It must be concluded that the Plaintiff has not produced all of the prerequisites in admissible form to establish that plaintiff was "ready, willing and able" to close as a matter of law. 54. Furthermore, plaintiff s attempt to unilaterally make the contract one of time is of the essence when the contract was not time of the essence must also fail. 55. It is possible for a party to unilaterally convert a non-time is of the essence to a contract that is time is of the essence. This is done by giving the other party reasonable and sufficient notice which (1) must be clear, distinct and unequivocal; (2) must fix a reasonable time within which to perform; and (3) must inform the other party that failure to perform by the designated date will constitute a default (Zev v Merman, 134 Ad2d 555, 521 N.Y.S.2d 455, aff'd, 73 NY2d 781, 533 N.E.2d 669, 536 N.Y.S.2d 739 (1989)). 56. The contract in question was not a time of the essence agreement when signed by the parties; therefore, it must be determined if the plaintiff successfully unilaterally made the contract one where time of the essence.

9 57. Here, plaintiff failed to give a reasonable time to perform. 19 days to clear three foreclosure actions, to resolve other litigation brought by MCCRAY and to remove MCCRAY from the title, and to clear other title liens, would not constitute reasonable time to perform. 58. The last of the three foreclosures was resolved on February 5, Moreover, in accordance with paragraph 10 of the Rider to the Contract, the CADORE s were under no obligation to comply with the terms of the contract after they determined that they were unable to convey marketable title. (See, Exhibit A, Residential Contract of Sale, Rider 10) 60. Consequently, not only did Plaintiff failed to make the contract one where time is of the essence, but Defendants were no longer obligated to comply with the contract and Plaintiff failed to prove that he was ready, willing and able to close. AS AND FOR DEFENDANT AND THIRD PARTY PLAINTIFF S FIRST CAUSE OF ACTION AGAINST GOODMAN, LEGAL MALPRACTICE 61. The CADORE s repeat and reallege the allegations set forth in paragraphs 1 through 60 herein. 62. GOODMAN represented the CADORE s in the underlying Residential Contract of Sale for the subject property. 63. Based upon information and belief, GOODMAN failed to appropriately terminate the contract and to timely refund Plaintiff s down payment. 64. GOODMAN failed to exercise due diligence when he failed to return the down payment to Plaintiff s counsel.

10 65. GOODMAN failed to provide proof that Plaintiff s down payment remains in GOODMAN s escrow account or in a segregated interest bearing account. 66. Based upon information and belief, GOODMAN may have converted Plaintiff s down payment. 67. GOODMAN failed to comply with the directives of his clients, the CADORE s, and cancel the Residential Contract of Sale for the subject property in accordance with the terms of the contract and return the down payment. 68. GOODMAN failed to sign the contract as Escrowee. 69. GOODMAN failed to monitor the underlying foreclosure actions and give appropriate advice as to those pending matters in relation to the sale of the subject property. 70. GOODMAN failed to require the customary down payment of 10% to purchase the subject property. 71. Based upon information and belief, GOODMAN failed to comply with the applicable ethical rules that govern residential real estate transactions, specifically Canon 1, General Rules Applicable to Practice; Canon 5, Conflicts of Interest, Where Lawyer has a Duty to Exercise Independent Professional Judgment on Behalf of a Client; Canon 7, Represent a Client Zealously within the Bounds of the law; and Canon 9, Avoid Even the Appearance of Professional Impropriety, including, but not limited to, notifying client of receipt of funds and maintain complete records. 72. As a result of legal malpractice, the CADORE s have been damaged in an amount to be determined at trial, including, but not limited to attorney fees and costs, interest, and damages and costs awarded to Plaintiff in this action, if any.

11 AS AND FOR DEFENDANT AND THIRD PARTY PLAINTIFF S SECOND CAUSE OF ACTION AGAINST GOODMAN, NEGLIGENCE AND GROSS NEGLIGENCE 73. The CADORE s repeat and reallege the allegations set forth in paragraphs 1 through 72 herein. 74. GOODMAN as the attorney for the CADORE s had a duty to competently represent the CADORE s interest in the Residential Contract of Sale for Real Estate for the subject property. 75. GOODMAN breached his duty and was negligent and grossly negligent when he failed to, appropriately terminate the Contract; exercise due diligence; provide the CADORE s with the receipt of funds regarding the down payment to GOODMAN; comply with the directives of his clients, the CADORE s, which were to cancel the Residential Contract of Sale for the subject property in accordance with the terms of the contract; comply with the rules of ethics regarding the conduct of lawyers; monitor the underlying foreclosure actions and give appropriate advice as to those pending matters in relation to the sale of the subject property and require the customary down payment of 10% to purchase the subject property. 76. The CADORE s have been harmed by GOODMAN s negligence and gross negligence in that they are now being sued and must expend funds to defend themselves. 77. As a result of the negligence and gross negligence of GOODMAN, the CADORE s have been damaged in an amount to be determined at trial, including, but not limited to attorney fees and costs, interest, and damages and costs awarded to Plaintiff, if any, in this action. AS AND FOR DEFENDANT AND THIRD PARTY PLAINTIFF S THIRD CAUSE OF ACTION AGAINST GOODMAN,

12 OBLIGATION TO INDEMNIFY 78. The CADORE s repeat and reallege the allegations set forth in paragraphs 1 through 77 herein. 79. As a result of GOODMAN s legal malpractice and negligence, Plaintiff has sued the CADORE s for specific performance, for $3,000,000, plus interest, for Plaintiff s damages and attorney fees and costs. 80. Equity demands that GOODMAN indemnify the CADORE s for any damages and costs awarded to Plaintiff. AS AND FOR DEFENDANT AND THIRD PARTY PLAINTIFF S FOURTH CAUSE OF ACTION AGAINST GOODMAN, INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS 81. The CADORE s repeat and reallege paragraphs 1 through 80 as if fully set forth herein. 82. GOODMAN caused intentional infliction of emotional distress to the CADORE s when they engaged in extreme and outrageous conduct and intentionally caused severe emotional distress. 83. GOODMAN caused emotional distress intentionally when he failed to perform duties in accordance with the standards of the legal profession. As a result, the CADORE s have been sued and they could lose their family home. 84. GOODMAN s acts were outrageous in that they demonstrated a callus disregard for the emotional distress that losing the family home and facing continued litigation would cause considering that the CADORE s have gone through three foreclosure actions and at least one other action brought by MCCRAY.

13 85. As a result of GOODMAN s malpractice, negligence, and gross negligence, the CADORE s suffer from stress and anxiety. 86. As a result of the GOODMAN s conduct, they are liable to the CADORE s for actual damages in an amount to be proved at trial; costs and disbursements in an amount to be proved at trial; and attorneys' fees in an amount to be proved at trial. herein AS AND FOR DEFENDANT AND THIRD PARTY PLAINTIFF S FIRST CROSS CLAIM AGAINST JENKIN, BREACH OF CONTRACT 87. The CADORE s repeat and reallege paragraphs 1 through 86 as if fully set forth 88. Plaintiff breached the contract when he failed to close on or about December 19, 89. Plaintiff failed to prove that he was ready, willing and able to close and as a result, breached the contract. 90. Once, Purchaser s breached the contract, Seller no longer was bound to perform. See,1550 Fifth Ave. Bay Shore, LLC v. 150 Fifth Ave., LLC, 748 N.Y.S.2d 601 (2d Dept. 2002) (seller entitled to cancel where commercial contract allowed seller to cancel if firm commitment not obtained.) 91. WHEREFORE, Defendants and third party Plaintiffs, the CADORE s, demands judgment against the third party Defendant, GOODMAN, for any and all sums which may be adjudged against Defendants and third Party Plaintiffs in the favor of the Plaintiff, JENKIN, together with applicable interest therein, plus a judgment in favor of the Defendants and third party Plaintiffs against the third party Defendant ordering the third party Defendant to pay the Defendants and third party Plaintiff s legal fees and

14 costs and Indemnify the Defendants and third party Plaintiffs in the lawsuit commenced by the Plaintiff, JENKIN, against the Defendant and third party Plaintiff plus costs and disbursements of this action; and/or alternatively to find that Plaintiff breached the contract and is liable to the Defendants and third party Plaintiffs for costs and disbursements and for such other and further relief as this Court deems just and proper. Dated: May 5, 2015 Susan Pepitone Susan Pepitone, Esq. Attorney for Veronica and Michelle Cadore, Defendant and Third Party Plaintiff th Road Forest Hills, NY phone/fax To: Peter Goodman 1517 Voorhies Avenue 2 nd Floor Brooklyn, NY The Goodman Law Firm 1517 Voorhies Avenue 2 nd Floor Brooklyn, NY David Kaminsky and Associates 325 Broadway Suite 504 New York, NY 10007

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